Rental income after probate

moedeeb

We have probate and a property currently operating as an Airbnb is now being moved as per the will to the beneficiary. The solicitor has advised that this may take up to a year as the Land Registry is running behind and prioritising actual sales.

I have seen positive input from the Land Registry on this forum and I know that the Registration of property can be complex.

Can anyone help on whether the beneficiary can assume accountability income tax wise for property income from the point Probate is issued or do we need to wait until the land registry elements are concluded and maintain an estate account.

I have posted previously re trust complexity etc but thanks to advice on here “Talk to a professional “ all is now sorted. This is a fairly specific income question.

poseidon1

For the benefit of others purporting to address this question, note the complexity of the background here, and the fact that 90% of the AirBnb property is/was owned by a discretionary trust-

https://forums.moneysavingexpert.com/discussion/6594698/trust-income-for-mother-in-law-in-nursing-home-care

What is unclear from this question is what has happened to the trust since March 2025, and what ( if anything) does that have to do with probate presumably for the MIL, the original trust beneficiary, who it seems has since died.

grannypep

I wouldn't have thought someone who isn't the legal owner can assume respinsibility for income tax. As far as I'm aware, the property would still be part of the estate and income and expenses pertaining to the property would be part of that. There is some quite helpful information on dealing with estates after Probate (or Confirmation in Scotland) on the Gov.uk website. You were helped previously, as per your message, by being advised to seek professional advice and you have mentioned trust complexity so the finances do not appear to be straightforward and a professional adviser seems to me to be an approach that you should consider again.

moedeeb

The MIL has died and it was clarified by the solicitors that the Trust had a 50% interest in the property. The solicitors have now removed the property (50%) from the trust and we have paid relevant CGT for this as a chargeable event.

From the date of her death The MIL estate was getting the relevant rental profits (50%) and as such will pay income tax at 20%.

So now Probate is granted I assume a legal assent is needed and after that the profit becomes property income for the beneficiary.

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/82158545#Comment_82158545

Somewhat bewildering that your last definitive statement on the matter indicated 90% of the property was in the trust, but frankly shouldn't be greatly surprised it has now shrunk to 50%, the story seems to change on each telling.

In any event since you had retained a specialist trust accountant to deal with the trust and its termination, you should turn to that accountant to assist with income tax compliance for both the deceased estate and the beneficiary of the terminated trust. You certainly should not being trying to handle it.

It is obvious to me that if the trust held 50% of the AirBnb property prior to its termination, then the beneficiary in whose favour the trust terminated, is now so entitled. As for the 50% originally owned by the deceased MIL, that is either taxable within the estate if the estate is still being administered, or taxable on the beneficiary of the estate if that 50% share has already been 'assented' in their favour.

Either way leave it to the trained professional to navigate who should be taxed and how.